Thailand

Country Progress Report

December 2021

SUPPLEMENT TO THE 2021 GLOBAL PROGRESS REPORT OF

THE SUSTAINABLE BANKING AND FINANCE NETWORK
 Acknowledgements

This SBFN Country Progress Report was developed by the SBFN Secretariat under the leadership of the SBFN
Measurement Working Group with guidance from the SBFN Thailand Country Coordinator Huong Thien Nguyen
and Asia Regional Coordinator Wei Yuan. Data are provided by the Thai Bankers’ Association (TBA) and verified by
SBFN. The team is grateful for the support and guidance of TBA representatives who provided data, participated in
interviews, and reviewed and provided comments to this report, in particular Kobsak Duangdee, Secretary General,
Darutsakorn Wisootthisin, Assistant Secretary General, and Chayasun Kumanwisai, Senior Officer, Secretary-General
Office & Corporate Strategy.

About SBFN About IFC

Established in 2012, SBFN is a voluntary community of
financial sector regulators and industry associations from
emerging markets committed to collectively advancing
sustainable finance in line with international good practice
and national priorities. As of October 2021, SBFN members
represented 63 institutions, 43 countries, and $43 trillion
(86 percent) of the total banking assets in emerging markets.
Members are committed to i) improving the management of
environmental, social, governance, and climate change risks
in financial sector activities, and ii) increasing capital flows
to activities with positive environmental and social impacts,
including climate change mitigation and adaptation. For
more information, visit www.sbfnetwork.org
IFC—a member of the World Bank Group—is the largest
global development institution focused on the private
sector in emerging markets. IFC works in more than 100
countries, using its capital, expertise, and influence to
create markets and opportunities in developing countries.
In fiscal year 2021, IFC committed a record $31.5 billion to
private companies and financial institutions in developing
countries, leveraging the power of the private sector to
end extreme poverty and boost shared prosperity as
economies grapple with the impacts of the COVID-19
pandemic. For more information, visit www.ifc.org.

© International Finance Corporation [2021], as the Secretariat of the Sustainable Banking and Finance Network (SBFN). All
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This work was prepared in consultation with SBFN members. The findings, interpretations, and conclusions expressed
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Contents

1 2
Overall country progress
– Thailand Progress by three pillars
1. SBFN member institution Pillar 1: ESG Integration
2. Other key institutions and Pillar 2: Climate Risk Management
national initiatives promoting Pillar 3: Financing Sustainability
sustainable finance
3. Overall progress page 5

4. Country sustainable
finance journey
5. COVID response
6. Ambitions for the next phase
7. SBFN and IFC role

page 2

3 4
Progress by three sub-pillars Library of national
and 11 indicators sustainable finance
framework documents
Sub-pillar 1: Strategic Alignment
Sub-pillar 2: Regulatory and Industry National strategies, roadmaps,
Association Actions policies, voluntary principles,
regulations, guidelines, research,
Sub-pillar 3: Expectations of Financial
templates, and tools that provide
Institution Actions
an enabling framework for
page 11 sustainable finance

page 12

5
SBFN measurement framework
and methodology
Summary of the SBFN measurement
framework, a systematic approach to
benchmark country progress in developing
national enabling frameworks for
sustainable finance

page 13

1
1. Overall country progress – Thailand
1.1 SBFN member institution:

Thai Bankers’ Association (TBA) Member Since: 2012

1.2 Other key institutions and national initiatives promoting sustainable finance

Ministry of Natural Resources and the Environment Stock Exchange of Thailand (SET)
Bank of Thailand (BOT) National Economic and Social Development Council
Office of the Insurance Commission (OIC) (NESDC)
Ministry of Finance (MOF) National Economic and Social Development Plan
Thaipat Institute (NESDP)
Working Group on Sustainable Finance (WG-SF) Securities and Exchange Commission (SEC)
Thai Banking Academy (TBAC)

1.3 Overall progress

Thailand has moved to the “Developing” sub-stage of the “Implementation” stage from the “Formulating”
sub-stage of the “Preparation” stage. Thailand has formally launched its sustainable finance framework. In 2019,
the Thai Bankers’ Association (TBA) released the Thailand Sustainable Banking Guidelines. The Guidelines define
the minimum expectations on responsible lending practices for all banks based in Thailand. Also in 2019, the Three
Regulators Steering Committee, consisting of BOT, SEC, OIC, and MOF, established and mandated the Working
Group on Sustainable Finance (WG-SF) to foster and monitor a culture of sustainable finance throughout Thailand’s
financial sector. In July 2020, the Ministry of Finance published the Sustainable Financing Framework to support
its sustainability commitments and to set out how it intends to raise Green, Social, and Sustainability financing
instruments. In 2021, the WG-SF formulated the Sustainable Finance Initiatives for Thailand, setting the direction and
framework for driving sustainable finance across the financial sector.

Overall Results (without movements)

Figure 1: SBFN Progression Matrix - Overall Country Progress
Maturing
Implementation
Mainstreaming
Preparation Consolidating
Behavioral Changes
Developing Advancing
Commitment Formulating China
Argentina Bangladesh
Colombia
Cambodia Brazil
Kazakhstan Indonesia
Chile
Costa Rica Georgia
Lao PDR Fiji
Dominican Kenya
Maldives Jordan Republic
Mexico
Samoa Kyrgyz Ecuador
Republlic Mongolia
Serbia Egypt
Morocco
Tunisia Ghana
Nigeria
Honduras
South
India Africa

Iraq Turkey

Nepal Vietnam

Pakistan

Panama

Paraguay

Peru

Philippines

Sri Lanka

Thailand * Countries within each sub-stage are listed in alphabetical order

Ukraine 2
1.4 Country Sustainable Finance Journey
Figure 2: Thailand’s sustainable finance journey
Policies, principles, regulations,
and guidance.
2012
TBA joins SBFN
2018
TMB Bank issues Thailand’s first
green bond
SEC publishes Guidelines on
Issuance of Green, Social, and
Sustainability Bonds
2019
Three Regulators Steering
Committee establishes and
mandates the Working Group on
Sustainable Finance (WG-SF)
TBA publishes the Sustainable
Banking Guidelines on
Responsible Lending
Research and engagement
2014
Stock Exchange of Thailand
joins the UN Sustainable
Stock Exchanges (SSE)
initiative, making Thailand the
first Southeast Asian country
committed to promoting
sustainability within its
capital markets
2017
NESDC issues the National
Economic and Social Development
Plan
SEC publishes Investment
Governance Code for Institutional
Investors (I Code)
2020
MOF publishes the Sustainable
Financing Framework and issues
Thailand’s first Sustainability Bond
SEC and Thai Bond Market
Association launch a Green, Social,
and Sustainability Information
Platform on ESG debt issuance
SEC publishes guidelines for issuing
Green, Social, and Sustainability
Bonds
3
Examples of
market actions
and impacts
2015
The Government of Thailand
ratifies the Paris Agreement
on Climate Change and
commits to reducing its
greenhouse gas emissions
by 20 percent between 2015
and 2030
2016
Thaipat Institute becomes a
signatory of the United Nations-
supported Principles for
Responsible Investment
2021
Working Group on Sustainable
Finance publishes the
Sustainable Finance Initiatives
for Thailand
Thai Union Launches Thailand’s
First Sustainability-Linked Bond
SEC publishes comprehensive
guidance on issuance of
sustianability-focused bonds
1.5 COVID response

A fiscal package was unveiled in March 2020, worth approximately 400 billion Thai baht, consisting of soft loans
worth 150 billion Thai baht, debt payments extension, and tax benefits including reduction of withholding taxes, to
provide support for households, including by reducing and delaying utility bills. The Bank of Thailand has pledged
to set up mechanisms to ease liquidity for commercial banks that buy investment units of COVID-19-affected mutual
funds in the money market and daily fixed income funds through collateralization of investment units for liquidity. The
Thai Bankers’ Association, Government Savings Bank, Insurance companies, and Government Pension Fund together
committed to establishing the Corporate Bond Liquidity Stabilization Fund (BSF), amounting to 70 to 100 billion Thai
baht, to inject liquidity.

1.6 Ambitions for the next phase

Sustainability is one of the four priorities in TBA’s three-year strategic plan. TBA has been working closely with the Association
of Banks in Singapore and the World Wildlife Fund (WWF) since 2020 to develop an online training course on sustainable
finance in the Thai language. The course is under development and should be ready in 2021. MOF issued a 50 billion Thai
baht sovereign sustainability bond in 2020, the first sustainability bond in the country, and the proceeds are being used for
infrastructure projects, including the mass railroad transit system, and to assist in COVID recovery. ESG bond issuances in
Thailand raised over 80 billion Thai baht in 2020 and are expected to reach 100 billion Thai baht in 2021. TBA is working to
promote transparency throughout the financial system as well as financial inclusion. Digital transactions and digital trade
transformation are also key areas of focus for TBA.

The report, Sustainable Finance Initiatives for Thailand, published in August 2021, sets the direction and framework for driving
sustainable finance across the entire financial sector. This is a collective achievement - with technical assistance from IFC
and SBFN - by a public-private Working Group on Sustainable Finance, which consists of the Ministry of Finance, the Bank of
Thailand, the Securities and Exchange Commission, the Office of Insurance Commission, and the Stock Exchange of Thailand.
It provides key strategic objectives and initiatives to set up an ecosystem to enable sustainable finance in five key areas,
including developing a sustainable finance taxonomy, improving the ESG data environment, implementing effective incentives
for sustainable finance products, and building human capital.

1.7 SBFN and IFC role

IFC has provided advisory services to TBA for their sustainable finance initiatives and capacity building. IFC has supported
the Working Group on Sustainable Finance to develop the Sustainable Finance Initiatives roadmap issued in August
2021. Through SBFN, TBA has shared its experience with other SBFN members and benefited from the collective SBFN

“
knowledge base.

There are a lot of things that we can foresee that TBA and SBFN could collaborate on
in the future on the sustainable banking journey – the contribution in this area from
IFC would be helpful. We would be looking to work more with SBFN when we have

“
the strategic plan implemented in 2022. Sustainable banking is an area where we
would like to move forward, and working in close cooperation would be welcomed.
Mr Kobsak Duangdee
Secretary General

Thai Bankers’ Association (TBA)

4
2. Progress by three pillars
Figure 3: Mapping of overall country progress and individual pillar progress

Overall mapping

Maturing
Implementation
Preparation Consolidating Mainstreaming
Behavioral Changes
Developing Advancing
Commitment Formulating

Pillar-level mapping

Pillar 2: Pillar 3: Pillar 1:

Climate Risk Financing ESG
Management Sustainability Integration

1. Progress by 3 Pillars
Pillar 1: ESG Integration
PillarProgress:
Pillar 1: ESG Integration
Advancing

Thailand is mapped under the “Advancing” sub-stage of the “Implementation” stage for the ESG Integration pillar. There
is an existing national framework addressing the integration of ESG risk and performance considerations into the practices
of Financial Institutions (FIs). In addition to ongoing activities to raise awareness and build capacity, implementation tools
and initiatives are in place, and FIs report on their ESG implementation with consistent reporting instructions or templates.

Strategic Alignment

Thailand
East Asia and the Pacific

SBFN Average

Expectations of Financial Regulatory and Industry

Institution (FI) Actions Association Actions

Sub-pillar 1: Strategic Alignment • Thailand’s approach to ESG integration in the

• Thailand’s national framework for the banking sector,
including the Sustainable Banking Guidelines on
Responsible Lending (TBA, 2019), sets out expectations
for integrating the consideration of ESG risks
and performance by banks.
financial sector is aligned with international
good practices and standards, such as the UN
Sustainable Development Goals (SDGs), Principles
for Responsible Banking (PRB), and Task Force on
Climate-Related Financial Disclosures (TCFD).

5
• The Sustainable Banking Guidelines were developed in
close consultation with members of TBA with inputs from
WWF.
Sub-pillar 2: Regulator and Industry Association Actions
• In August 2019, TBA released the Sustainable Banking
Guidelines, serving as guidance for banks to establish
a responsible lending strategy to manage their
environmental and social (E&S) impacts and risks.
• The implementation of the Guidelines is regularly
monitored by TBA. Banks are required to disclose how
they implement the responsible lending practices in
reports or on their websites in a timely and reliable
manner.
• TBA established the Thai Banking Academy (TBAC)
with the mission to become a world-class academy for
banking and financial professionals in Thailand. The
online training platform will provide training courses on
sustainable finance in the Thai language.
6
• Bank of Thailand (BOT) launched a three-year strategic
plan (2020-2022) with the theme of “Central Bank in
a Transformative World” to strengthen the resilience
of Thailand’s financial and economic system to help
promote inclusive and sustainable growth of the Thai
economy. One of the seven strategies is “sustainability
(environmental, social and governance) as an integral
part of all operations”.
• BOT is in the process of developing a sustainable
finance policy framework, which includes a sustainability
roadmap and tools to help the banking sector improve
ESG risk management practices.
Sub-pillar 3: Expectations for FI Actions
• The Sustainable Banking Guidelines require FIs to
develop policies and procedures to manage ESG
risks and performance, undertake regular review and
monitoring of ESG risks, and report ESG performance
publicly.
Pillar 2: Climate Risk Management
Pillar Progress: Formulating

Pillar 2: Climate Risk Management

Thailand is in the “Formulating” sub-stage of the “Preparation” stage of the Climate Risk Management pillar. The
Thai Bankers’ Association, with the support of the Bank of Thailand, has released ESG risk management guidelines for
the banking sector that include climate risk. Preparations and activities include research, surveys, multi-stakeholder
engagement, and raising awareness about expectations for climate risk management.

Strategic Alignment

Thailand

East Asia and the Pacific

SBFN Average

Expectations of Financial Regulatory and Industry

Institution (FI) Actions Association Actions

Sub-pillar 1: Strategic Alignment
• Addressing climate change risks is a national priority
as indicated in Thailand’s Nationally Determined
Contribution (NDC) to the Paris Agreement and national
climate policies, including the Climate Change Master
Plan 2015-2050 (released in 2016).
• In the financial sector, TBA’s Sustainable Banking
Guidelines include climate risk as one of the key
environmental risks that FIs must manage.
Sub-pillar 2: Regulatory and Banking Association Actions
• BOT has recognized the role of the financial sector
in driving Thailand’s sustainable growth and the
promotion of sustainable banking has been part of BOT’s
strategic plan. BOT is a member of the Central Banks and
Supervisors Network for Greening the Financial System
(NGFS).
• TBA’s 2019 Sustainable Banking Guidelines reference
climate change as a component of ESG risks and
emphasize the importance of exposure assessment at the
transaction and portfolio levels and of determining how
these risks materialize into financial risks. The Guidelines
reference management and disclosure practices,
including the Taskforce for Climate-related Financial
Disclosures (TCFD).
• The Stock Exchange of Thailand (SET) is a member of the
UN Sustainable Stock Exchanges Initiative and has online
guidance on ESG disclosure and reference to the TCFD
in addition to the Guidelines for Sustainability Reporting
(2012), which incorporate energy, greenhouse gas, and
climate-related elements of the Global Reporting Initiative
and CDP standards.
• With ambition to promote the transition to a low-carbon
economy, SET is also promoting TCFD disclosures
among Thai businesses, listed companies in particular.
SET, in collaboration with CDSB and SASB, launched the
translated TCFD Good Practice Handbook (in Thai).
• The Securities and Exchange Commission is a formal
supporter of the TCFD.
• As part of future progress by Thailand, recommended
areas of focus for regulatory and industry association
actions include awareness raising, research, capacity
building, and technical guidance (for example, climate
scenarios, risk assessment tools and methodologies) to
build financial sector understanding of climate-related
physical and transition risks and financial impacts.
Sub-pillar 3: Expectations for FI Actions
• The Sustainable Banking Guidelines released by the
Thai Bankers’ Association serve to build familiarity
and capacity among Thai FIs to improve climate risk
management practices as part of overall ESG risk
management approaches. The Guidelines emphasize
how the identification and management of ESG risks
and climate-related risks at the portfolio level allow
banks to build long-term resilience and unlock growth
prospects. The Guidelines reference international
practices, including TCFD.

2
• As part of future progress, the Sustainable Banking
Guidelines for banks can be further elaborated with
technical guidance and implementation tools to support
the expected actions of FIs for the development of their
strategy, governance, risk management, metrics/targets,
and disclosure approaches for climate-related physical
and transition risks and financial impacts.

8
 Pillar 3: Financing Sustainability
Pillar Progress: Developing

Thailand is mapped under the “Developing” sub-stage of the “Implementation” stage for the Financing Sustainability
pillar. There is a national framework for promoting financial flows into green, climate, social, and sustainability-linked
Pillar 3: Financing Sustainability
projects and sectors, as well as ongoing awareness raising and capacity building. In 2020, the Thai Securities Exchange
Commission published the Guidelines on Issuance and Offer for Sale of Green Bond, Social Bond, and Sustainability
Bond, promoting the country’s sustainable-focused bond in alignment with the ASEAN Green, Social, and Sustainability
Bond Standards.  

Strategic Alignment

Thailand

East Asia and the Pacific

SBFN Average

Expectations of Financial Regulatory and Industry

Institution (FI) Actions Association Actions

Sub-pillar 1: Strategic Alignment
• Thailand’s national framework for financing sustainability
covers both the banking sector and the capital markets
and is aligned with international standards.
• The Ministry of Finance issued its Sustainable Financing
Framework in 2020, alongside its issuance of the
first sovereign sustainability bond in Thailand. The
Framework aligns with the SDGs, the Paris Agreement
on Climate Change, and Thailand’s Twelfth National
Economic and Social Development Plan (2017-2021).
It is also aligned with international and ASEAN capital
markets standards.
• The Thai Securities and Exchange Commission
published the Guidelines on Issuance and Offer for Sale
of Green Bond, Social Bond, and Sustainability Bond in
2018, which aligns with ASEAN and International Capital
Market Standards.
• MOF’s approach to financing sustainability also
identifies and involves key stakeholders, and promotes
engagement. MOF has set up a Committee consisting of
multiple government agencies and industry associations
to monitor projects funded under its Sustainable
Financing Framework.
investment and provides a list of green project categories
and social project categories. It tasks a Committee
to monitor the use of proceeds and the positive E&S
impacts of eligible green and social projects annually.
The Committee tracks and monitors the environmental
and social benefits of the eligible green and social
projects that are funded by MOF’s green, social, or
sustainability financing instruments.
• The Committee under the Sustainable Finance
Framework also reports on the associated environmental
and social benefits on an annual basis starting one
year from the first Green, Social, or Sustainability
financing instrument issuance until the full allocation
of the proceeds. The report(s) will be made available
to investors on the Public Debt Management
Office’s website.
• The SEC’s Green Bond, Social Bond, and Sustainability
Bond Guidelines explicitly require issuers to follow
either the ASEAN standards or International Capital
Market Association principles, and therefore give clear
instructions on eligible projects, issuance process,
disclosure, and external verification to ensure the
credibility of sustainability instruments.

Sub-pillar 2: Regulatory and Banking Association Actions Sub-pillar 3: Expectations for FI Actions
• MOF’s Sustainable Financing Framework sets up a • TBA’s Guidelines for Sustainable Banking ask banks
government-funded scheme to support green and social to dedicate resources and specify clear roles and

For details for each pillar, sub-pillar, indicator, datapoint, and referring policy document, please visit the SBN Online Analytical Tool at [URL TBD].

3
 responsibilities to support the implementation of the
responsible lending strategy.
• TBA’s Guidelines also ask banks to publish relevant
statements, policies, and processes in their annual
sustainability reports or websites.
• The SEC’s Green, Social, and Sustainability Bond
Guidelines ask issuers to publish annual updates on
the performance and impacts of the sustainability
instruments and to obtain and disclose independent
10
review of metrics reported annually in relation to the
social and environmental outcomes and impacts
achieved through the sustainability instruments.
• The SEC’s Green, Social, and Sustainability Bond
Guidelines also require information to be published on
the issuers’ website on an annual basis, on elements
such as use of proceeds and project progress, and in line
with relevant international and national standards and
regulations.
2. Progress by 3 Sub-Pillars and 11 Indicators
3. Progress by three sub-pillars and 11 indicators
Figure
Figure4:
1: Overview
Overviewof
ofThailand’s
Thailand’ssustainable
sustainablefinance
financecoverage
coveragein
inthree
threeframework areas
thematic areas

Pillar 1: Pillar 2: Pillar 3:

ESG Integration Climate Risk Management Financing Sustainability
Sub-pillar 1: Strategic Alignment

National Framework Coverage

Alignment with International

Goals & Standards

Alignment with National Goals

& Strategies

Sub-pillar 2: Regulatory and Industry Association Actions

Overall Approach & Strategy

Technical Guidance

Supervisory Activities &

Incentives

Tracking & Aggregated

Disclosure

Sub-pillar 3: Expectations of Financial Institution (FI) Actions

Strategy & Governance

Organizational Structure &

Capacity Building

Policies & Procedures

Tracking, Reporting & Disclosure

All data in the report are pending member confirmation. 4

11
4. Library of national sustainable finance
framework documents
National strategies, roadmaps, policies, voluntary principles, regulations, guidelines,
research, templates, and tools that provide an enabling framework for sustainable finance

Sustainable Finance Initiatives Sustainable Bond Strategic Plan 2020-

for Thailand Issuance Guide 2022 — including focus
(Working Group on Sustainable (Thai SEC, 2021) on ESG and sustainable
Finance, 2021) finance
(Thai SEC, 2020)

Sustainable Financing Framework Sustainable Banking Guidelines on

(Kingdom of Thailand, 2020) Responsible Lending
(TBA, 2019)

Guidelines on Issuance and Offer for Investment Governance Code for

Sale of Green Bond, Social Bond, and Institutional Investors (I Code)
Sustainability Bond - including ESG
(Thai SEC, 2018) (Thai SEC, 2017)

Download framework documents and check for updates at www.sbfnetwork.org/library

12
5. SBFN measurement framework
and methodology
About SBFN
Established in 2012, the Sustainable Banking and Finance
Network (SBFN) is a unique, voluntary community
of financial sector regulatory agencies and industry
associations from emerging markets committed to
advancing sustainable finance in line with international
best practice. SBFN is facilitated by IFC as secretariat, and
supported by the World Bank Group.
As of October 2021, SBFN comprised 43 member countries
representing over US$43 trillion and 86 percent of total
banking assets in emerging markets. Members are
committed to collectively driving measurable change.
Why a measurement framework?
In 2016, members requested a systematic comparison of
country approaches to developing national sustainable
finance frameworks. The SBFN Measurement Working
Group was established to convene member inputs on the
design of a common framework to benchmark country
progress and accelerate peer-to-peer knowledge exchange.
The Framework is designed to inform the biennial SBFN
Global Progress Report.
The Framework can be used as:
a mapping tool to capture the dynamic
interaction of collective insights, market-
based actions, and policy leadership
demonstrated by SBFN members as they
move their financial markets
toward sustainability;
a benchmarking tool for SBFN
members to learn from and compare
peer approaches, track and review
progress against global benchmarks,
develop common concepts and
definitions, and leverage innovations
and strengths; and
a forward planning and capacity
building tool to identify future policy
pathways and capacity building needs.
13
1
An evolving framework
The SBFN Measurement Framework reflects the activities,
strategies, and tools that members use to promote
sustainable finance in their countries. It evolves to match
advances in country initiatives. It also incorporates the latest
international standards and best practices identified by
members as important to their efforts.
A member-led approach
The Framework was designed with extensive member input
under the leadership of the Measurement Working Group
and Co-Chairs. Updates to the Framework are guided by
the Measurement Working Group and agreed by all SBFN
Members.
Data collection in partnership with members
As of 2021, data collection for the SBFN Global Progress
Report relies on member country reporting in line with the
updated Measurement Framework. Information is supported
by evidence, which is verified by the SBFN secretariat in
collaboration with third-party service providers. Evaluation
and milestones are objective and transparent. Members
approve the final Global and Country Progress Reports.
The Measurement Framework is based on three
intersecting themes in sustainable finance. For each
theme, it assesses regulatory guidance, supervision
strategies, disclosure requirements, and voluntary
industry approaches.
ESG Integration refers to the management of
environmental, social, and governance (ESG) risks in
the governance, operations, lending, and investment
activities of financial institutions.
Climate Risk Management refers to new governance,
risk management, and disclosure practices that financial
institutions can use to mitigate and adapt to climate change.
Financing Sustainability refers to initiatives by
regulators and financial institutions to unlock capital flows
for activities that support climate, green economy, and
social goals. This includes new products like green bonds
and sustainability-linked loans. Initiatives include definitions,
guidance, taxonomies, monitoring, and incentives.
The Measurement Framework consists of three complementary
components:

1. Progression matrices
Drawing on SBFN members’ common development paths
and milestones, the SBFN Progression Matrix provides
an overview of market-wide progress for all SBFN countries
across three typical stages of development. It allows each
SBFN member to review its own progress and identify the
strengths and weaknesses of its approach.
The stage mapping is based on qualitative milestones and
quantitative analysis related to (i) progress in developing
and implementing national policies and principles, and (ii)
industry uptake and practices. In the 2021 report, in addition
to the Overall Progression Matrix, three pillar-level matrices
are added to reflect a country’s development process in
each of the pillar areas.

Overall Mapping Country

Maturing
Implementation
Preparation Consolidating
Mainstreaming
Behavioral Changes
Developing Advancing
Commitment Formulating

Pillar-Level Mapping

Pillar 2: Pillar 3: Pillar 1:

Climate Risk Financing ESG
Management Sustainability Integration

2. Pillar benchmarking

A dynamic assessment is conducted Pillar 1: Pillar 2: Pillar 3:

Climate Risk Financing
across several priority pillars of sustainable ESG Integration Management Sustainability
finance, using qualitative and quantitative
• National framework
datapoints to assess progress and allow Sub-pillar 1:
• Alignment with international goals and standards
comparison across countries. Three pillars, Strategic Alignment • Alignment with national goals and strategies

three cross-cutting sub-pillars, 11 cross-

cutting indicators, and 75 underlying
datapoints are used to objectively assess a
country’s sustainable finance framework(s),
according to clarity, depth, and alignment
to international good practice.
Sub-pillar 2: Regulatory
and Industry Association
Actions
Sub-pillar 3:
Expectations of Financial
Institution (FI) Actions
• Overall approach and strategy
• Technical guidance
• Supervisory activities and incentives
• Tracking and aggregated disclosure
• Strategy and governance
• Organizational structure and capacity
• Policies and procedures
• Tracking, reporting, and disclosure

3. Sector data and case studies

In 2021, data collection included an exploratory request for quantitative data points — where available — for the number and
percentage of financial institutions that are implementing ESG integration as well as climate risk management and disclosure;
and the total value of green, social, and sustainability bond issuance. Detailed case studies were also collected of innovative
approaches by regulators and industry. Case studies will be published in a new on-line case study catalogue.

SBFN on-line case study catalogue

Coming soon

14
SBFN Measurement Framework pillars, sub-pillars, indicators, and underlying datapoints
Pillar 1: ESG Integration
Sub-
Indicator No. Underlying datapoint
pillar
National framework1 1 Has the regulator or industry association published a national framework (“Framework”) for the banking sector that sets out expectations for
(e.g. policies, roadmaps, integrating the consideration of environmental, social, and governance (ESG) risks and performance?
guidance, regulations, 2 Has the relevant regulator or industry association published a Framework for capital markets, investment, insurance or other non-lending FIs
voluntary principles, that sets out expectations for integrating the consideration of ESG risks and performance?
Strategic Alignment

templates, or tools)
Alignment with 3 Does the Framework make reference to international sustainable development frameworks or goals?
international goals and
standards
4 Does the Framework make reference to established international ESG risk management standards and principles for FIs?

Alignment with national 5 Does the Framework make reference to specific national development objectives, plans, policies, goals, or targets?
goals and strategies 6 Does any cooperation exist between agencies or between the regulator and industry association with respect to policy design and/or
implementation related to ESG integration?
7 Does any inter-agency data sharing currently exist related to ESG integration by FIs?
Overall approach and 8 Does the Framework provide guidance on the role of the regulator or industry association with regard to assessing and managing ESG risk
Regulatory and Industry Association Actions

strategy and performance in the financial sector?

9 Has the regulator or industry association undertaken market assessment to identify systemic ESG risks through analysis of the portfolios of
supervised entities/members and published the results?
Technical guidance 10 Does the Framework provide technical guidance or tools to support implementation of ESG risk and performance management by the
financial sector?
Supervision activities 11 Is the implementation of the Framework regularly monitored and/or information regularly collected from FIs by the regulator and/or industry
and incentives association?
12 Does the regulator or industry association provide any financial or non-financial incentives for FIs to manage ESG performance as part of the
Framework?
13 Does the regulator or industry association apply any disincentives/penalties for non-compliance by FIs in terms of expectations from the
regulator and/or industry association related to ESG risk management as part of the Framework?
Tracking and 14 Has the regulator or industry association established a data collection approach and database to track or regularly publish data related to
aggregated disclosure ESG integration by FIs as part of the Framework?
Strategy and 15 Does the Framework require/ask the FI’s board of directors (or highest governing body) to approve an ESRM and/or ESG integration strategy,
governance and to supervise its implementation?
Organizational structure 16 Does the Framework require/ask FIs to allocate resources/budget commensurate with portfolio ESG risks and define roles and
and capacity responsibilities for ESG integration within the organization?
17 Does the Framework require/ask FIs to develop and maintain the ESG expertise and capacity of staff commensurate with portfolio ESG risks
Expectations of FI Actions

through regular training and learning?

18 Does the Framework require/ask FIs to create incentives for managers to reduce the ESG risk-level of the portfolio over a specified
timeframe?
Policies and procedures 19 Does the Framework require/ask FIs to develop policies and procedures to identify, classify, measure, monitor, and manage ESG risks and
performance throughout the financing cycle at the client level and/or the transaction/project level?
20 Does the Framework require/ask FIs to undertake a regular review and monitoring of ESG risk exposure at aggregate portfolio level?
21 Does the Framework require/ask FIs to establish and maintain an external inquiry/complaints/grievance mechanism for interested and
affected stakeholders in relation to ESG practices?
Tracking, reporting, and 22 Does the Framework require/ask FIs to report ESG risks and performance to the regulator or industry association?
disclosure 23 Does the Framework require/ask FIs to report on ESG integration publicly?
24 Does the Framework require/ask FIs to track credit risk (e.g. loan defaults) and/or financial returns in relation to ESG risk level?

Pillar 2: Climate Risk Management

National framework 25 Has the regulator or industry association published a national framework (“Framework”) for the banking sector that sets out expectations for
integrating the consideration and management of climate risks and their impact in the national economy?
26 Has the relevant regulator or industry association published a Framework for capital markets, investment, insurance, or other non-lending FIs
that sets out expectations for integrating the consideration and management of climate risks and their impact in the national economy?
Strategic Alignment

Alignment with 27 Does the Framework make reference to international agreements or frameworks to address climate?
international goals and
28 Does the Framework recognize or align with established regional or international good practice for climate risk management and disclosure
standards
by FIs?
Alignment with national 29 Has the regulator or industry association aligned the Framework with national goals to address climate change in line with the country’s
goals and strategies Nationally Determined Contributions (NDCs) to the Paris Agreement?
30 Does any cooperation exist between agencies, or between government and industry association, with respect to policy design or
implementation related to climate risk management?
31 Does any inter-agency data sharing currently exist related to climate risk management by FIs?

1 National framework refers to the collective set of policies, roadmaps, guidance, regulations, and/or voluntary principles issued by national regulators or industry associations in
relation to each pillar of sustainable finance. SBFN recognizes that national frameworks for sustainable finance vary from country to country and are influenced by national priorities
and characteristics. They are also often interdependent with other national roadmaps, policies, and regulations. Countries vary in their starting points and the types of documents
to kickstart the enabling framework. For instance, initial frameworks could choose to focus on ESG risk management and/or sustainable finance opportunities such as green bonds.
They could also focus on banking, capital markets, or institutional investors. The variety of SBFN frameworks provides a rich source of inspiration for peer learning and collaboration.

15
3
 Overall approach and 32 Has the regulator or industry association undertaken research on historical impacts to the economy and financial sector from climate
strategy change, and/or future expected impacts resulting from physical and transition climate risks?
Regulatory and Industry
Association Actions

33 Does the Framework identify key sources of GHG emissions – such as in particular sectors – as priorities in the proactive management of
climate risks by the financial sector?
34 Does the Framework incorporate the conservation/restoration of natural carbon sinks (such as oceans, forests, mangroves, grasslands, and
soils) as an important part of reducing climate change risks (e.g., through guidelines, scenario analysis, targets, or incentives for FIs)?
35 Has the regulator or industry association developed an internal strategy to address climate risk, and/or embedded climate risk management
into its governance, organizational structures, and budget as part of the Framework?
36 Has the regulator or industry association undertaken any activities to expand and deepen analytical understanding of national and/or cross-
border physical and transition climate risks, and to raise awareness as to how these risks may transmit to, and impact, the financial sector?
Technical guidance 37 Has the regulator or industry association developed risk assessment approaches, methodologies, or tools to understand and assess the
financial sector’s exposure to climate risk as part of the Framework?
Regulatory and Industry

Supervisory activities 38 As part of the Framework, has the regulator clarified supervisory expectations with regard to climate risk management by FIs, including
Association Actions

and incentives consideration of international good practices?

39 Has the regulator started to explicitly embed climate-related risk in supervisory activities and review processes as part of the Framework?
40 Is the implementation of the Framework regularly monitored and/or information regularly collected from FIs by the regulator and/or industry
association?
41 Are there any financial or non-financial incentives to encourage FIs to establish climate risk management systems?
Tracking and aggregated 42 Does the regulator or industry association regularly collect and/or report market-level and/or FI-level data on climate-related financial sector
disclosure risks as part of the Framework?
Strategy and governance 43 Does the Framework require/ask FIs to establish a strategy for climate risk management with responsibility at the board of director level (or
highest governing body)?
Organizational structure 44 Does the Framework require/ask FIs to define the roles and responsibilities and related capacities of the FI’s senior management and
and capacity operational staff in identifying, assessing, and managing climate-related financial risks and opportunities?
Expectations of FI Actions

Policies and procedures 45 Does the Framework require/ask FIs to expand existing risk management processes to identify, measure, monitor, and manage/mitigate
financial risks from climate change?
Tracking, reporting, and 46 Does the Framework require/ask FIs to report on their overall approaches to climate risk management in line with international good
disclosure practices (e.g. TCFD), or establish a timeline by which FIs should begin to align their reporting with such practices?
47 Does the Framework require/ask FIs to identify, measure, and report on exposure to sectors which are vulnerable to transition risk and
physical risk?
48 Does the Framework require/ask FIs to adopt and report on performance targets to reduce portfolio greenhouse gas (GHG) emissions on a
regular basis?
49 Does the Framework require/ask FIs to adopt and report on performance targets to reduce exposure to climate change risks at the portfolio
level on a regular basis?

Pillar 3: Financing Sustainability

National framework 50 Has the regulator or industry association published a national framework (“Framework”) for the banking sector that sets out expectations for
integrating the consideration of instruments, goals, and standards for financing sustainability, including requirements for ensuring credibility
and managing and measuring resulting impacts in the national economy?
51 Has the relevant regulator or industry association published a Framework for capital markets, investment, insurance, or other non-lending
FIs that sets out expectations for integrating the consideration of instruments, goals, and standards for financing sustainability, including
requirements for ensuring credibility and managing and measuring resulting impacts in the national economy?
Strategic Alignment

Alignment with 52 Has the regulator or industry association developed a strategy, regulations, or set of frameworks for stimulating the allocation of capital to
international goals and sustainable assets, projects, and related sectors in line with global goals, such as the Sustainable Development Goals (SDGs)?
standards 53 Does the Framework recognize and/or align with existing standards, voluntary principles, or market good practices related to sustainable
finance instruments?
Alignment with national 54 Does the Framework enable the achievement of stated national objectives by guiding capital to sectors, assets, and projects that have
goals and strategies environmental and social benefits in line with national sustainable development priorities, strategies, targets, and the size of sustainable
investment needs, and taking into account the local barriers to scaling-up sustainable finance?
55 Does any cooperation exist between agencies or between the regulator and industry association with respect to policy design or
implementation related to sustainable finance flows?
56 Does any inter-agency data sharing currently exist related to stimulating and monitoring sustainable finance flows?
Overall approach and 57 Does the Framework require/ask the regulator or industry association to establish mechanisms to identify and encourage the allocation of
Regulatory and Industry Association

strategy capital to sustainable sectors, assets, and projects?

Technical guidance 58 Does the Framework provide definitions, examples, and/or a taxonomy (catalogue and guidelines) of sustainable finance assets?
59 Does the Framework provide guidelines for extending green, social, or sustainability-focused loans (excluding bonds)?
60 Does the Framework provide guidelines for issuance of green, social, or sustainability bonds?
Actions

61 Does the Framework require/ask for external party verification to ensure the credibility of sustainability instruments?
Supervisory activities 62 Does the regulator or industry association monitor information reported by FIs related to green/social/sustainability investment, lending, and
and incentives other instruments to prevent greenwashing and social-washing?
63 Are there any financial or non-financial incentives for FIs to develop and grow green, social, or sustainability finance instruments?
Tracking and aggregated 64 Does the regulator or industry association collect and/or publish data from FIs or other sources about allocation of capital to green/social/
disclosure sustainability assets, projects, or sectors?

16
4
 Strategy and governance 65
Organizational structure 66
and capacity building
67
Policies and procedures 68
Expectations of FI Actions
Does the Framework require/ask FIs to establish a strategy, governance, or high-level targets, including at the Board of Directors level, for
capital allocation to sustainable assets, projects, or sectors?
Does the Framework require/ask FIs to define internal staff roles and responsibilities to encourage finance flows to green, social, and/or
sustainability-focused investments?
Does the Framework require/ask FIs to develop and maintain internal staff capacity on green, social, or sustainability products through
regular training and learning?
Does the Framework require/ask FIs to put in place policies and procedures for defining, issuing, managing proceeds, tracking performance,

and reporting on green, social or sustainability-focused products?

69 Does the Framework require/ask FIs to appoint an independent external reviewer to confirm that the FI’s internal framework meets the
requirements of the recognized national framework and regulations, or aligns to international standards?
70 Does the Framework require/ask that FIs create incentives for managers to increase sustainable loans or investments in the portfolio?
Tracking, reporting, and 71 Does the Framework require/ask FIs to publish annual updates on the performance and impacts of the sustainability instruments in
disclosure compliance with relevant national and/or international standards?
72 Does the Framework require/ask FIs to obtain and disclose independent review of metrics reported annually in relation to the social and
environmental outcomes and impacts achieved through the sustainability instruments?
73 Does the Framework require/ask FIs to report to the regulator(s) or industry association(s) on allocation and/or outcomes of green, social,
and/or sustainability loans?
74 Does the Framework require/ask FIs to report to the regulator(s) or industry association(s) on green, social, and/or sustainability bonds or
other positive impact investments?
75 Does the Framework require/ask FIs to report publicly on their green, social, and sustainability-focused finance activities and positive
outcomes or impacts (i.e. not only to the regulator or shareholders)?

17
Figure 1: Overall Progression Matrix Milestones
Figure 1: Overall Progression Matrix Milestones
Figure 5: Overall Progression Matrix Milestones
Maturing
Maturing
Implementation
Implementation Mainstreaming
Preparation Consolidating Mainstreaming
Preparation Consolidating Behavioral Changes
Developing Advancing Behavioral Changes
Developing Advancing
Commitment Formulating
Commitment Formulating A comprehensive set There is an established
A comprehensive
of national Sustainableset There is an of
ecosystem established
A first national Implementation tools of national Sustainable ecosystem ofFinance
The financial sector A formal initiative A first national Implementation
The financial sector A formal roadmap, framework, and initiatives aretools Finance initiatives and Sustainable
regulator or industry — led by initiative
a financial roadmap, framework, and initiatives are Finance initiatives
frameworks are in and Sustainable
initiatives andFinance
regulator orhasindustry — led by a financial policy, regulation, in place, such as frameworks areall
in parts initiatives and
association sector regulator or policy, regulation, in place, such as place, covering frameworks that align
association ahas sector regulator or or or set of voluntary guidance, guidelines, place, coveringsystem.
all parts frameworks
announced formal
announced atoformal
industry
industry
association or set of principles
industry voluntary on guidance,templates,
reporting guidelines, of the financial and integratethat
withalign
each
commitment both — isassociation
in progressor industry principles on reportingonline
templates, of the financial system. and integrate with each
other.
commitment to both — is in progress Sustainable Finance training, tools, The national other.
achieve progress on to develop a national Sustainable Finance training, online tools,
achieve progress on to developframework,
a national has been formally and supervisory The nationalare aligned
frameworks Financial institutions are
Sustainable Finance roadmap, has been formally and supervisory
Sustainable Finance roadmap, framework, launched. instructions. frameworks
with are aligned
international good Financialorinstitutions
required encouraged are
in the next two years. policy, or voluntary launched. instructions.
in the next two years. policy, orprinciples
voluntaryon with international
practice across allgood
three required
to report or encouraged
publicly on
industry A formal taskforce The national
Initial steps have industry principles on A formal taskforce The nationalFinance practice
pillars of across all three
Sustainable to report
their publicly on
implementation
Initial taken,
steps have Sustainable Finance. or dedicated unit is Sustainable
been such as Sustainable Finance. or dedicated unit is SustainablecoversFinance pillars
Finance. of Sustainable their
of implementation
Sustainable Finance
leading implementation framework
abeen taken,
kick-off such as
meeting or Preparations include leading—implementation framework covers Finance. of Sustainable
across risk andFinance
efforts either within multiple parts of the
workshop with keyor
a kick-off meeting Preparations
research, suveys, include
efforts — either Consistent and across risk and
workshop with key research, suveys, the regulator or within multiple parts
financial system. of the Consistent and
comparable data is
opportunity.
opportunity.
stakeholders and multi-stakeholder the regulator or financial system.
stakeholders and multi-stakeholder industry association, or comparable
being databyisthe
collected The regulator or
industry. engagement, and/or industry association, or Financial institutions
industry. engagement, and/or as a multi-stakeholder Financial regulator as partby
being collected of the The regulator or
awareness raising for as a multi-stakeholder
working group or report on institutions
their regulator as— part of the
industry
industry
association
association
awareness
the financialraising
sector.for report on their of the supervision or by has multi-year data
working group or
platform. implementation supervision — or by the hasimplementation
multi-year databy
the financial sector. implementation of the industry association, on
platform. roadmap, framework, industry association,
The Sustainable roadmap,
policy, framework,
or voluntary about implementation financial institutionsby
on implementation
The Sustainable policy, or voluntary about implementation
by financial institutions. financial
— includinginstitutions
both risk
Finance initiative is principles in line with by financial institutions. — including bothData
risk
Finance initiative
acknowledged or is principles in
consistent line with
reporting and opportunity.
acknowledged or consistent reporting and opportunity.
includes information Data
supported by both instructions or includes information
supported and
regulators by both
industry. instructions
templates or
provided on the benefits of
regulators and industry. templates provided on the benefits
Sustainable Finance.of
by the financial sector Sustainable Finance.
Awareness raising and by the financial
regulator sector
or industry
Awareness
capacity raisinghave
building and regulator or industry
capacity building have association.
been conducted. association.
been conducted.

Figure 6: Progression Matrix Milestones – Pillar 1: ESG Integration

Figure 2: Progression Matrix Milestones – Pillar 1: ESG Integration
Figure 2: Progression Matrix Milestones – Pillar 1: ESG Integration

Maturing
Maturing
Implementation
Implementation Mainstreaming
Preparation Consolidating Mainstreaming
Preparation Consolidating Behavioral Changes
Developing Advancing Behavioral Changes
Developing Advancing
Commitment Formulating
Commitment Formulating A comprehensive The national
A comprehensive The national ESG
frameworks for
A first national Implementation tools national initiative or set
national initiative frameworks foraligned
ESG
The financial
The financial
A formal initiative is in
A formal initiative is in
A first national
policy, regulation, Implementation
and initiatives aretools of frameworks areorinset Integration are
sector regulator or progress to develop policy, regulation, and initiatives are of frameworks are inESG Integration are aligned
with international good
sector regulator or progress to develop guidelines, or set of in place, such as place that promote
place that promote with international good
industry
industry
association
association
a policy, regulation,
a policy, regulation,
guidelines, or set of
voluntary principles in place, such
guidance, as
guidelines, Integration across allESG parts practice and national
has announced guidelines, or voluntary voluntary principles guidance,templates,
guidelines, Integration across all parts practice andand
regulations; national
has been formally reporting of the financial system.
ahas announcedto
commitment guidelines,on
principles orESG
voluntary
has been formally reportingonline
templates, of the financial system. regulations; and
are consistent across
a commitment to principles on launched that sets training, tools,
develop a policy, Integration forESG
the launched that sets training, online tools, The national frameworks are consistent
different across
parts of the
out requirements and supervisory The national
develop a policy,
regulation, guidelines, Integration for
financial sector. the
out requirements and supervisory cover all threeframeworks
cross- different parts
financial of the
sector. 
regulation, or recommendations instructions. cover allareas threeofcross-
or voluntaryguidelines, financial sector.
or recommendations instructions. cutting ESG financial sector. 
or voluntary Preparations for financial cutting areas of ESG
principles for the Preparations for financialon ESG The ESG Integration Integration: Local financial
institutions Local financial
principlessector
financial for the include research,
include research, institutions on ESG The ESG Integration
expectations cover 1.Integration:
strategic alignment, institutions
financial sector surveys, multi- Integration. expectations 1. strategic alignment, institutions that
on integrating the surveys, multi- Integration. multiple partscover
of the 2. regulatory
2. industry
regulatory
and
and
demonstrate
demonstrate that
on integratingofthe
management stakeholder multiple parts of the association they have embedded
stakeholder A formal taskforce, financial system.
management ofsocial, engagement, and/ A formal group,
taskforce, financial system. industry association theyrequirements
the have embedded for
environmental, engagement, and/ working or actions, and
environmental, actions, and of the requirements for
and governancesocial, or awareness
or awareness
raising
raising
working group,
institution or
is tasked Financial institutions 3. expectations ESG Integration and
Financialon institutions ESGreporting
Integration
and governance
(ESG) risks and for the financial sector. institution is tasked
for the financial sector. with implementation report their 3. financial
expectations of
institution are on and
their
(ESG) risks and with implementation report on their of
implementation financial institution are reporting on their
performance (ESG and/or supervision actions. efforts.
performance (ESG and/or supervision implementation
ESG Integration in of actions. efforts.
Integration). and is supported
Integration). and is supported ESGwith
line Integration
consistentin Consistent and Extensive data
by regulators and Extensive dataavailable
A first event or by regulators and line with consistent
reporting instructions comparableand
Consistent data are are becoming
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workshop has industry.  or templates provided becoming available on trends among
workshop has been or templates provided becoming available on on trendsinstitutions
financial among
held to engage Activities include by the financial sector trends in the practices
held to engage Activities include by the financial sector trends in theinstitutions
practices in financial institutions
regarding practices in
relevant financial awareness raising regulator or industry of financial
relevant financial awareness raising regulator or industry of financial institutions in regarding
ESG practices
Integration and in
sector stakeholders and capacity association. relation to ESG Integration
sector stakeholders and capacity association. relation to ESG Integration ESGresulting
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benefits.
on the topic of ESG building for financial and the resulting benefits.
on the topicfor ofthe
ESG building foron financial and the resulting benefits. the resulting benefits.
Integration institutions the
Integration
financial for the
sector. institutions on the for
new expectations 18
financial sector. new Integration.
expectations for
ESG
ESG Integration.
Figure 3: Progression Matrix Milestones – Pillar 2: Climate Risk Management
Figure 3: Progression Matrix Milestones – Pillar 2: Climate Risk Management
Figure 7: Progression Matrix Milestones – Pillar 2: Climate Risk Management
Maturing
Maturing
Implementation
Implementation Mainstreaming
Preparation Consolidating Mainstreaming
Preparation Consolidating Behavioral Changes
Developing Advancing Behavioral Changes
Developing Advancing
Commitment Formulating
Commitment Formulating A comprehensive The national frameworks
A comprehensive
national initiative or The nationalRisk
for Climate frameworks
A national policy, Implementation tools national initiative or for Climate Risk
The financial A formal initiative A national policy, Implementation tools set of frameworks Management are aligned
The financial A regulation, guidelines, or and initiatives are in
sector regulator or is formal initiative
in progress to regulation, guidelines, or and initiatives set of in frameworks Management are aligned
sector regulator or is in progress to set of voluntary industry place, such as are in
guidance, are
are
place aimed at
in placeallaimed
with international good
industry
industry
association
association
develop or refine set of voluntary
principles is in placeindustry
that place, such as guidance,
guidelines, reporting supporting partsatof with international
practice expectations goodand
has announced adevelop
national orpolicy,
refine
principles is in place that guidelines, reporting supporting
the financialallsystem
parts of
to practice expectations
national climate change and
has announcedto aregulation,
national policy, includes requirements templates, training, the financial system
a commitment
adevelop
commitment to regulation,
guidelines, includes requirements
and/or recommendations templates,
online tools,training,
and manage climate risk.to national climateand
commitments; change
are
a policy, or voluntaryguidelines,
industry and/or recommendations online tools, instructions
and manage climate risk. commitments;
consistent across anddifferent
are
develop a policy, or for the financial sector supervisory
regulation, or principles onindustry
voluntary Climate for the financial sector supervisory instructions The national frameworks consistent
parts of theacross
financialdifferent
regulation,principles
or principles on Climate to manage climate to help the financial The
covernational
all threeframeworks
cross- parts
voluntary
voluntary
Risk Management to manage climate
risk — either as part of to helpmanage
sector the financial
climate- cover allareasthreeofcross- sector.of the financial
on Climateprinciples
Risk Risk
for theManagement
financial risk cutting Climate sector.
on Climate Risk for the —financial ESG—Integration
either as partor asofa sector
relatedmanage
physicalclimate-
and cutting areas of Climate
Risk Management: Local financial institutions
Management for the sector either as ESG Integration or as a related
Management for the sector standalone framework. transition risks. and
physical Risk Management: Local financial institutions
financial sector. part of aneither
— as
existing standalone framework. transition risks. 1. strategic alignment, demonstrate that they
financial sector. part of an existing 1.2. strategic
regulatoryalignment,
and demonstrate
have embedded thatthe
they
ESG framework or A formal taskforce, Financial Institutions
Initial awareness ESG framework or A formal group,
taskforce, Financial 2. industry
regulatory and have embedded for the
Initial as a standalone working or report on Institutions
their association requirements climate
raisingawareness
and as a standalone working industry association requirements for climate
raising and sharing framework. institutiongroup, or the
is taking report
approach on their
to Climate actions, and risk management and are
knowledge
knowledge sharing
framework. institution
lead is taking the
with implementation approach
Risk to Climate
Management in 3. actions, and of
expectations risk management
reporting on their and are
efforts.
is being organized Preparations include lead with implementation Risk Management 3. expectations of reporting on their efforts.
is and/or supervision, and is line with consistentin financial institution
bybeing organized
the regulator or Preparations
research, surveys, include
and/or supervision, and is line with consistent financial institution
actions. Extensive data are
by the regulator or research, surveys, supported by regulators reporting instructions actions. Extensive
becoming data are on
available
industry association. multi-stakeholder supported by regulators reporting instructions
industry association. multi-stakeholder and industry. or templates provided Consistent and becoming
trends among available on
financial
engagement and/or and industry. or templates provided
engagement and/or by the financial sector Consistent
comparableand data are trends among
institutions financial
regarding
awareness raising for Activities include by the financial
awareness regulator and/orsector comparable data areon institutions
climate risk regarding
the financialraising
sector.for Activities
awarenessincluderaising, regulator and/or becoming available management
the financial sector. awarenessguidance
raising, and/ industry association and becoming
trends in the available on
practices climate
and the risk management
resulting benefits.
research, industry
reflectingassociation
international and trends in theinstitutions
practices and the resulting benefits.
research,
or capacity guidance
buildingand/
for reflecting international of financial
or capacity building onfor practices. of financialtoinstitutions
in relation Climate
financial institutions practices. in relation to Climate
financial institutions
managing climate-related on Risk Management and
managing climate-related Risk Management
the resulting and
benefits.
physical and transition the resulting benefits.
physical andwith
risks in line transition
the
risks in line with the
new expectations in the
new expectations
national framework. in the
national framework.

Figure 4: Progression Matrix Milestones – Pillar 3: Financing Sustainability

Figure 8: Progression
4: Progression Matrix
Matrix Milestones
Milestones – Pillar
– Pillar 3: Financing
3: Financing Sustainability
Sustainability

Maturing
Maturing
Implementation
Implementation Mainstreaming
Preparation Consolidating Mainstreaming
Preparation Consolidating Behavioral Changes
Developing Advancing Behavioral Changes
Developing Advancing
Commitment Formulating
Commitment Formulating A comprehensive The national frameworks
A comprehensive
national initiative or The national frameworks
for Financing
A national framework Implementation tools national initiative or for Financing are aligned
The financial sector A formal initiative A national set of frameworks Sustainability
The financial sector A formal initiative is in place framework
that Implementation
and initiatives are tools
set of frameworks Sustainability are aligned
regulator or industry is in progress is in placeregulations
that and initiatives are are in place aimed at with international good
regulator or has
industry is includes in place, such as
association made to in progress
develop a includes regulations in place, such as
are in placeall
supporting aimed
partsatof with international
practice expectationsgood
association has made to develop a or guidance for the guidance,guidelines, supporting
a public commitment policy, regulation, or guidance for to
the guidance,guidelines, the financialallsystem
parts of practice expectations
and national sustainable
atopublic commitment policy, regulation, financial sector taxonomies, the financialfinancial
system and national sustainable
develop a policy, guidelines, or financial sector to taxonomies, to promote development plans; and
to develop guidelines,
a policy, guidelines,principles
or promote financial reporting templates, to promote financial development
regulation, voluntary promote financial reporting templates, flows to green, social, or are consistentplans;
acrossand
regulation, flows to green, social, training, online tools,
or voluntaryguidelines,
principles voluntary
to promoteprinciples
financial flows to green, social, training, online tools,
flows to green, social, or
sustainability-focused are consistent
different parts ofacross
the
or voluntaryfinancial
principles to promote financial or sustainability- and supervisory sustainability-focused different
to promote flows to green, social, or sustainability- and supervisory projects and sectors. financial parts
sector.of the
to promote financial flows to green, social, focused projects and instructions to help projects and sectors. financial sector.
flows to green or or sustainability- focused projects and instructions
flows to green or or sustainability- sectors. the financialto help
sector The national Local financial institutions
sustainability-focused focused projects and sectors. the financial sectorflows The nationalcover all Local financial institutions
sustainability-focused focused promote financial
projects and sectors. sectors. projects and A taskforce, working promote
frameworks demonstrate that
projects and sectors. sectors. A taskforce, working to green, financial
social, orflows frameworks cover all
three cross-cutting demonstrate that
they have embedded
group, or institution to green, social, or
sustainability-focused three cross-cutting theyrequirements
have embedded
Initial awareness Preparations include group, or with
institution areas of Financing the for
Initial is tasked sustainability-focused
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